Fitch Ratings has raised India’s GDP growth projection for the current fiscal year to 6.9%, up from its earlier forecast of 6.5%. The move comes after the April–June quarter delivered stronger-than-expected growth and domestic consumption continued to support demand.
Fitch is the first global rating agency to upgrade India’s growth outlook this year, after several others trimmed estimates earlier citing tariff worries and global trade uncertainty.
According to Fitch’s September Global Economic Outlook, real GDP growth accelerated to 7.8% in April–June, compared with 7.4% in January–March. Its June report had pencilled in only 6.7% for that quarter. On the back of this performance, Fitch now sees India growing 6.9% in the year ending March 2026.
The agency flagged recent tensions with the US, which has doubled tariffs on Indian imports to 50% since August 27. While Fitch expects these duties to eventually ease, it warned the uncertainty could affect sentiment and investment.
Domestically, it pointed to the upcoming GST restructuring from September 22, which it believes may provide a modest boost to consumer spending over the next two years.
Fitch expects domestic demand to remain the key driver of growth, supported by real income gains and looser financial conditions that encourage investment. Still, it projects momentum to slow in the second half of the financial year, covering October to March.
For 2026–27, Fitch sees GDP growth moderating to 6.3%, edging lower to 6.2% in 2027–28.
With its 6.9% projection for FY26, Fitch is currently the most optimistic among rating agencies. The Reserve Bank of India, Asian Development Bank and S&P Global Ratings all forecast 6.5%. Moody’s expects 6.3% for calendar year 2025, while the IMF and World Bank put India’s growth at 6.4% and 6.3% respectively.
Fitch anticipates weak food price pressures in the near term, helped by above-average monsoon rainfall and comfortable stockpiles. It expects inflation to pick up only gradually, reaching 3.2% by end-2025 and 4.1% by end-2026.
On monetary policy, Fitch forecasts the Reserve Bank of India to cut rates by 25 basis points later this year, keep them unchanged through 2026, and start raising them again in 2027.